News Release

Prague

Prague Residential Market in H2 2015

2016-02-22T06:00:00Z

JLL has published a report on the residential property market in H2 2015 as part of their regular monitoring of the market in Prague

​Prague, 22 February 2016 – In H2 2015, a total of ca. 2,300 apartments in 34 projects were commenced in Prague. In 2015 as a whole, a total of ca. 5,000 apartments were commenced in Prague which, compared to 2014’s results, represents a decrease of 19%. For 2016, ca. 5,500 apartments are planned to be commenced.

“Our data shows that 2016 should be a record year for the number of completed apartments in Prague. This year, approximately 6,700 apartments are scheduled for completion, which is associated with the high number of projects commenced in 2014. It will be the highest figure since 2009,” says Blanka Vačkova, head of research at JLL, and continues: „ The majority of new projects in 2015 were commenced in Prague 9, Prague 10, Prague 5 and Prague 4, but there were actually new projects commenced in all districts, except for Prague 2.“

Demand for new apartmentsDuring the second half of 2015, a total of ca. 3,600 units were sold in new apartment buildings and villa houses. Compared to H1 2015, the number of sold apartments slightly decreased. Year-on-year, the H2 2015 results are 18% higher than those from H2 2014. For the entire year (2015), the total number of apartments sold reached 7,500 which is a 29% improvement on 2014 numbers. Unsurprisingly, the largest volume of sold apartments was recorded in Prague 10, Prague 9 and Prague 5, which altogether accounted for almost 4,700 apartments.

“The most significant stimulation of the strong demand, besides improved economic situations, remains to be the record low interest rates on mortgage loans,” explains Iva Nováková, head of residential department at JLL.

Price level of new apartmentsThe price levels of apartments in Prague have been adjusting over the past few quarters. The ups and downs have been caused by the constantly changing structure of available supply, strong price competition among major developers and the potential taxation changes on the market. The average price of apartments, which are currently available on the market, reached 54,100 CZK per sqm, increasing by 3.5% since H1 2015. The average price for available apartments, which are currently being offered on the market, is approximately 7% higher than it was a year ago.

“Regarding price segments of available flats, in general it can be said that development projects in the cheapest segment - less than 35,000 CZK per sqm – have almost disappeared from the market. On the other hand, we have registered an increase of projects in the price category of 45,000 CZK sqm to 65,000 CZK per sqm,” says Blanka Vačkova.

“The current market is the domain of strong domestic developers, who constitute the majority of the volumes in the market. Stable or slightly rising prices and low interest rates are a very positive sales support tool. The market is still driven by smaller apartments - nearly 40% of all sold apartments last year were one bedroom apartments,” says Iva Nováková.

For more information and a list of offered properties by JLL visit homefinder.cz.